Bitcoin hits 18-month price high amid trade fund speculation

On Tuesday, Bitcoin surged by 6%, reaching its peak value for the first time in almost 18 months.

At a certain moment, the value of it increased to a maximum of $35,198 (£28,844) due to assumptions that US regulatory bodies may authorize the issuance of an exchange-traded fund (ETF) based on its current market value.

Investors will be able to be involved in Bitcoin without possessing the cryptocurrency itself which could result in a surge of fresh attention.

The cryptocurrency market has seen an increase, with Bitcoin rising by 10% on Monday. Other digital currencies have also seen positive growth.

In August, a court in the United States made a decision that the Securities and Exchange Commission (SEC), which is a regulatory body, was incorrect in their denial of Grayscale Investments' application for a Bitcoin ETF.

After the ruling, it was reported that officials had no intention of challenging the decision. As a result, there has been increasing speculation that the SEC may finally approve the establishment of this fund.

Authorities have formerly endorsed exchange-traded funds associated with Bitcoin, but exclusively in the futures industry.

Find out more about the business news of the day: The limit on how much bankers can receive in bonuses is set to be removed. The rate of unemployment in the United Kingdom is still at a low level. Additionally, almost half a million employees will see an increase in their salaries to match the real living wage.

A big investment company known as BlackRock, along with other major firms, have applied for Bitcoin ETFs that show the spot price. However, there were rumors last week that they had been granted approval, which BlackRock has since denied.

This week, there is an increased sense of excitement as DTCC, a clearing house, has published iShares Bitcoin Trust, managed by BlackRock, on their website. This indicates that regulators may approve it soon.

Geoffrey Kendrick, who is in charge of researching digital assets at Standard Chartered, commented that there is now a higher chance that the SEC will approve an ETF (Exchange-Traded Fund) due to the influence the courts have been exercising on them.

According to Steen Jakobsen, who serves as the chief investment officer at Saxo Bank, the worth of any property is essentially determined by the number of individuals utilizing it. Therefore, the ETF would attract a vast audience and enhance its liquidity.

Although there has been an increase, the value of cryptocurrency has been unstable over the past few years and it is currently nowhere near its peak value of nearly $69,000 (£56,600) that was reached in November of 2021.

There are worries about how this development might harm the environment and investors might face losses as well.

At the start of this year, the Treasury Committee of MPs from different political parties urged the government to classify cryptocurrency trading and speculation as a form of betting. This was due to concerns about the industry's inadequate regulation.